WHAT MORE NEEDS TO BE DONE
The lack of structural reforms has other serious pitfalls. Fiscal discipline can easily dissipate quickly with a leadership change, and bad habits can quickly return without repairing institutional checks.
A good start would be for the Anwar administration to publish a definitive and unvarnished parliamentary white paper on 1MDB, a full accounting of which institutions failed, which individuals were complicit and the laws that were circumvented. It also should be mandatory reading for Members of Parliament and the civil service.
What Malaysia also urgently needs is a comprehensive Political Financing Act with real teeth; one that makes mandatory public disclosures for donations about RM20,000, a prohibition of donations from government-linked entities and criminal liability on political party treasurers who fail to report.
Separately, Malaysia must relook the prime minister-as-finance minister model.
While the model may work fine for other countries, the 1MDB debacle has raised a legitimate question for Malaysia about whether concentrating the premiership and finance portfolio in the same office provides sufficient institutional checks.
Malaysia does not need more statements about 1MDB. It needs structures that make a repeat physically impossible.
Last month’s sukuk bond issues showed that financial markets have forgiven Malaysia. That trust, however, can easily evaporate.
